World Bank

Motto: Working For A World Free of Poverty
Formation: July 1944
Headquarter: Washington D.C.
Membership: 189 (IBRD)
                          173 (IDC)
President: Jim Yong Kim

WORLD BANK GROUP:

1) International Bank for Reconstruction and Development (IBRD)


2) International Development Association (IDA)

3) International Finance Corporation (IFC)

4) Multilateral Investment Guarantee Agency (MIGA)

5) International Center For Settlement Of Investment Disputes (ICSID)

• The IBRD, the original arm of the WB, offers assistance to middle income and poor but credit worthy countries and it also works as an umbrella for more specialized bodies under the World Bank.

• The IDA offers loans to the world's poorest countries. These loans come in the form of "credits," and are essentially interest-free. They offer a 10-year grace period and hold a maturity of 35 years to 40 years.

• The IFC works to promote private sector investments by both foreign and local investors. It provides advice to investors and businesses and it offers normalized financial market information through its publications, which can be used to compare across markets. The IFC also acts as an investor in capital markets and will help governments privatize inefficient public enterprises.

• The MIGA supports direct foreign investment into a country by offering security against the investment in the event of political turmoil. These guarantees come in the form of political risk insurance, meaning that MIGA offers insurance against the political risk that an investment in a developing country may bear.

•The ICSID facilitates and works towards a settlement in the event of a dispute between a foreign investor and a local country.

World Bank & India :
India has been borrowing from the World Bank through IBRD and IDA for various development projects in the areas of poverty reduction, infrastructure, rural development etc. IDA funds mostly used in Social sector projects. IBRD funds are relatively costlier but cheaper than commercial external borrowings. The GOI utilized IBRD loans primarily for infrastructure projects.

Recent activity India related to World Bank :

• Government of India and World Bank Sign US$1.5 Billion Agreement to Support India’s Universal Sanitation Initiative.
• World Bank will work with Indian Railways for the Railway Development Fund.
• India signs financing agreement with World Bank for US$ 3OO million.
• India has signed $35 million loan agreement with the World Bank for MP project.